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Judge Rules Thant IRS Owes $234M To Sovereign Bancorp

November 16, 2015

IRS Owes $234M To Sovereign In Tax Row, Judge Rules

A Massachusetts federal judge on Friday ruled that Sovereign Bancorp can recover some $234 million that it paid in taxes, interest and penalties to the federal government over an international securities transaction, finding the deal had a business purpose outside its tax benefits.

Granting a motion for summary judgment by Sovereign — now Santander Holdings USA Inc. — and denying a cross motion for partial summary judgment by the federal government, U.S. District Judge George A. O’Toole Jr. decided that the so-called structured trust advantaged repackaged securities, or STARS, transaction had economic substance.

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Read more at: Tax Times blog

Finally the Senate Foreign Relations Committee Approves 8 Tax Treaties!

November 11, 2015


We previously posted on October 31, 2015, Republican and Democratic Lawmakers Vow to Push Tax Treaties Delayed by Sen. Paul! where we discussed that over a year ago, we posted U.S. Senator Rand Paul Continues To Block 5 Important Tax Treaties where we discussed that the U.S.-Switzerland tax treaty remains stuck in the Senate after Sen. Rand Paul (R-Ky.) blocked an effort to propel it forward by Senate Foreign Relations Committee Chairman Robert Menendez (D-N.J.)
When a bipartisan Senate panel lambasted Swiss bank Credit Suisse for helping rich Americans evade billions in taxes, some watching the high-profile hearing couldn’t help but notice that Sen. Rand Paul sticks out like a elephant in the room. Senator Rand Paul on Wednesday June 4, 2014 again blocked the U.S. Senate from moving toward ratifying five pending tax treaties, saying they would make it easier for foreign governments to invade the privacy of Americans.
Now Treaties with:

  1. Chile,
  2. Hungary, 
  3. Poland,
  4. Japan,
  5. Luxembourg,
  6. Spain, 
  7. Switzerland, and
  8. the proposed protocol amending the multilateral Convention on Mutual Administrative Assistance in Tax Matters,

were approved on November 11, 2015 by the Senate Foreign Relations Committee, but their fate on the Senate floor remains uncertain.

The treaties, which also include agreements with Chile, Hungary, Spain, and Poland, as well as an international convention on mutual assistance on tax matters, were approved by unanimous consent. However, the chief opponent to passage of new tax treaties, committee member Rand Paul (R-Ky.), wasn't present at the markup.

The next step in the treaty approval and ratification process would consist of:
 
  1. The Committee scheduling a date to meet to report on the eight tax agreements, out of committee and send them to the full Senate for consideration.
  2. Once that occurs, the Senate must give its advice and consent to ratification with a two-thirds majority vote.
  3. After the Senate takes action, the President must sign an instrument of ratification to complete the approval and ratification process in the United States.
The agreements would come into force once instruments of ratification are exchanged on the respective tax agreement.
 

US taxpayers who have undeclared accounts in Credit Suisse or other Swiss banks, may now want to consider applying for the US Offshore Voluntary Disclosure Program (OVDP), which sets a limit to the penalties imposed on them by the Internal Revenue Service (IRS) for failing to declare foreign assets and earnings.
 
Once either:
  • The Swiss Banks disclose an account holder's name to the IRS under the non prosecution agreement or 
  • Mr. Andreas Bachmann or Josef Dorig or Markus Walder or Susanne Ruegg-Meier or Roger Schaerer discloses an account holder's name to the IRS or
  • Any 1 of the other 11 Credit Suisse Bankers, who were indicted in 2011 along with Mr. Dorig, discloses an account holder's name to the IRS 
the OVDP election is no longer available to that account holder!!!
 
Taxpayers Who Wish To Take Advantage
Of The OVDP Must Act Quickly!  
Have Un-Reported Income From a Swiss or OECD Country Bank?
 

Value Your Freedom?

Contact the Tax Lawyers at
Marini & Associates, P.A.
 
for a FREE Tax Consultation Contact US at 
www.TaxAid.us or www.TaxLaw.ms
or Toll Free at 888-8TaxAid (888 882-9243).

 

 
Sources
 
EY
 
Reuters

Read more at: Tax Times blog

IRS Issues IPU's For CFCs & Subpart F Income, Which State Their Subpart F Audit Positions!

November 10, 2015

On October 9, 2015 we posted LB&I Agents Lose Autonomy To Centralized Office That Will Be Using Data to Identify Compliance Risks For Audit!, where we discussed that tax practitioners will face new questions from examination teams as the IRS selects compliance risks based on data, in the Large Business and International Division's (LB&I) move from individual audits of multinationals to broader considerations involving risk assessment.

While LB&I is scheduled to implement the new structure in early calendar year 2016, in recently released new International Practice Units (IPUs), the IRS has provided additional guidance to its examiners on the audit of foreign base company sales income (FBCSI), a category of subpart F income. These IPUs focus on supply chain structures with foreign sales and/or manufacturing branches (including disregarded entities) that may be used by U.S. multinationals to avoid the application of the FBCSI rules.

As part of LB&I International’s knowledge management efforts, Practice Units are developed through internal collaboration and serve as both job aids and training materials on international tax issues. For example, Practice Units provide IRS staff with explanations of general international tax concepts as well as information about a specific type of transaction.  In general, IPUs identify strategic areas of importance to IRS and can provide insight as to how IRS examiners may audit a particular issue or transaction. However, they are not official pronouncements of law or directives and cannot be used, cited, or relied upon as such.


Since Dec. 15, 2014, IRS has released various IPUs, covering major international tax areas some of which we've listed below:

2015
11-04-2015 License of Intangible Property from U.S. Parent to a Foreign Subsidiary (PDF, 268KB)


10-29-2015 Sale by CFC to Unrelated Parties of Products Manufactured by Branch (PDF, 225KB)

10-29-2015 Conducting Functional Analysis for Foreign Base Company Income (FBCI) (PDF, 168KB)
10-29-2015 Concepts of Foreign Base Company Services Income (PDF, 200KB)
10-29-2015 Branch Rules for Foreign Base Company Sales Income (PDF, 222KB)
10-29-2015 Branch Sales to Unrelated Parties of Products Manufactured by CFC (PDF, 216KB)

Click here for the complete list of IPUs.

Whether you're being audited by the IRS and want to know how the IRS will view your and/or your client's tax positions or whether you're doing tax planning in this area; it would be advisable to review any applicable IPU so that you know the IRS's audit position on that particular issue.

Are You Being Audited by the IRS ?
 
Contact the Tax Lawyers at
Marini & Associates, P.A.
 for a FREE Tax Consultation Contact US at
www.TaxAid.us or www.TaxLaw.ms
or Toll Free at 888-8TaxAid (888 882-9243).

Read more at: Tax Times blog

Attorney Ronald A. Marini of Marini & Associates, P.A. has Achieved the AV Preeminent® Rating – the Highest Possible Rating from Martindale-Hubbell®.

November 9, 2015

Ronald A. Marini, a lawyer based in Miami, FL whose primary area of practice is International Tax Law & Tax Litigation Representation, has earned the AV Preeminent® rating from Martindale-Hubbell®

Miami, FL November 9, 2015 - Martindale-Hubbell® has confirmed that attorney Ronald A. Marini still maintains the AV Preeminent Rating, Martindale-Hubbell's highest possible rating for both ethical standards and legal ability, even after first achieving this rating in 2003.

For more than 130 years, lawyers have relied on the Martindale-Hubbell AV Preeminent® rating while searching for their own expert attorneys. Now anyone can make use of this trusted rating by looking up a lawyer's rating on Lawyers.com or martindale.com. The Martindale-Hubbell® AV Preeminent® rating is the highest possible rating for an attorney for both ethical standards and legal ability. This rating represents the pinnacle of professional excellence. It is achieved only after an attorney has been reviewed and recommended by their peers - members of the bar and the judiciary. Congratulations go to Ronald A. Marini who has achieved the AV Preeminent® Rating from Martindale-Hubbell®. 

To find out more or to contact Ronald A. Marini of Miami, FL, call 305-374-4424, or visit http://www.taxlaw.ms.

 Have A Tax Problem?

 
  

 

Contact the Tax Lawyers at 
Marini & Associates, P.A.

for a FREE Tax Consultation

Toll Free at 888-8TaxAid (888)882-9243.





 

Read more at: Tax Times blog

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